In this concluding part of a series, MIKE ODIEGWU delves into the world of illegal crude refining and uncovers the collusion of some security agents with the key players.

Wholesalers are the fuel that keeps illegal refineries burning

Illegal refiners are in business because their products are seriously sought after by customers. To get to the end users, the products travel from forests and creeks in the Niger Delta to villages, cities, suburbs, towns and even filling stations through wholesalers. The wholesalers in the chain of distribution act as the fuel that keeps the illegal refineries burning. They take the risk of visiting camps at night to buy products and transport them through rivulets and other water channels to jetties and waterside.

John Warioko is one of the wholesalers. He usually brings his products to Nembe jetty in Port Harcourt. Warioko embraced the business in 2020 and has vowed not to abandon it because of its profitability. He said: “I started this business around June or July 2020. During that time, I was struggling to survive. I used to drive a commercial bus before, but when I saw my friends and mates joining the business and making it, I decided to start. I joined because it is one of the businesses that make you grow fast, and many of my friends were already doing the business. So when I decided to join, I met my friends and they agreed to help me; so I started buying diesel from them from the jetty to sell to my customers.”

Warioko said persons involved in the business only prayed to escape security agencies who could arrest them and destroy their products. Describing the profitability of selling illegally refined products, he said: “When you buy one drum, let’s say you buy at the rate of N17,000 from the point (cooking point), you can sell at the rate of N70,000 to N80,000 on the jetty. So when you multiply that amount by the number of drums you sell per day, then multiply that for one week, you will see your profit.

“You can buy a drum of diesel for N17,000, but because of the so many settlements on the way when you are coming back with the product, you will increase the price when you reach land (jetty). You must settle boys (pirates) who come for collecting (looting); those boys will even want to kill you to collect (steal) your product and sell. You must also settle government (security men) along the way. That is why before you reach land, you will sell at the rate of N70,000 to N80,000.

“Some people who buy from the point (cooking point or camp) make more money because they buy at a cheaper price; they use pour-put boats and vessels; their own is not measured; they just charge according to the size of the boat and they gain more. Those people, in turn, sell in drums and tanks, they will also use pumping machine to fill their products into drums for their customers. But those who buy in smaller quantities sell to their customers like hotels, hospitals and other small businesses that use diesel.”

Warioko said sale of illegally refined products is the commonest business in the rural or riverine areas. He likened it to a point of sale (POS) business, saying it is everywhere. He said illegally refined products took over the riverine areas because residents had no access to products from conventional refineries. Having grown up in a riverine community, he said it was easy to learn and understand the business. He mentioned some of the risks involved in the business as possible arrests by security personnel; attacks by pirates and fire outbreaks at the cooking camps.

He said: “Another risk is fire; if there is a fire accident at the cooking point (camp), it is hard to survive there because the fire will spread very fast. The fire can run on the water more than you; so unless God saves you, you will be burnt to ashes. Then another risk is boys (pirates), who can attack your boat and take away your product and go and sell it the way they like.”

Narrating one of his experiences, he said: “I remember one day when we were carrying our products along the creeks using two boats, I was on the first boat in front and the second boat engine behind us was disturbing; the engine would turn off on its own as we were going. As the second boat driver tried severally to restart the engine, the engine sparked a fire and coupled with the hot sun that day, the fire spread to the product and became serious fast. All efforts to extinguish the fire didn’t work.

“All the boys in the second boat have to jump into the water and run away fast. It was one of the boys, I can’t remember his name, who could not swim so he remained inside the boat and was burnt to death. The entire boat and the product inside burnt; it was the next day that we recovered the body of the boy who was burnt and buried him.

“Fire has burned my two legs before forcing me to stay indoors for three months; it was a nurse that treated me at my place till I recovered. I discharged fuel from one of our boats that day and the fuel poured on my trousers, but I didn’t mind it. I didn’t change it. I wore it to smoke Indian hemp. It was while I was smoking that the fire started. It burned my trousers, my legs and my manhood. I am glad I didn’t lose my private part, but the next day, my skin started peeling off; it was a painful experience, but I survived it.”

 

 Playing hide-and-seek game with security agents

Warioko said manoeuvring security agencies and their checkpoints while evacuating the products remains an important aspect of the business. He narrated how they compromise corrupt security personnel and get intelligence from them on the positions of their colleagues along the waterways. He said: “We calculate the weather; we have our intels (intelligence) within security agencies. The work of our intels is to observe and give us information about their colleagues; where they are and where they are not, so you know the alternative route to follow when you are moving with the product.

“Sometimes, when the security personnel are at a point, you divert and wait for a signal from your intels before making any move. We bribe the security people; even some boys who come to disturb us. One thing about this business is that you must know the routes very well, so you can use them during emergencies. But, most times, we rely on luck because if you are not lucky, you can be arrested. If you meet the government (security agents), they will shoot you.

“At that point, if you are a good swimmer, you can jump into the river and escape and they will either burn your boat and the product or seize them. I remember one time when we bought drums of diesel worth N3million. Unfortunately, on our way back, we meet security agencies, and they seized everything. It’s part of the business; sometimes you win, sometimes you lose.”

 

Illegal refining booms despite crackdown

Illegal refinery operation popularly called Kpofire has become a huge menace in the Niger Delta. Its proliferation is dumbfounding. From Ondo to Akwa Ibom states, the story is the same. It is a common sight in many communities. While working on roads, riding on speedboats or plying major highways in almost all the states and communities in the region, signs of their prevalence are seen through thick dark smokes billowing into the atmosphere.

Udengs Eradiri is a former President of the Ijaw Youths Council (IYC) Worldwide. He said illegal refinery operation has become part of the lives of the people in the region. He says: “It has become a quest for survival. Come down and see what is happening. You will find out that communities are now involved in it. You can’t even find speedboats anymore because they are all involved in the value chain, over a million young people. While I was President of the IYC, I was always in the waterways to see what was going on. I did helicopter flights to assess the damage in the region. What is happening is a war against our country.”

The boom has continued despite military operations to end illegal refineries. The Nigerian Navy, the Nigeria Security and Civil Defence Corps (NSCDC) and the Joint Task Force (JTF) Operation Delta Safe have been at the forefront of clamping down on illegal refinery camps. They usually storm identified camps in commando styles, destroy and set them ablaze. They also impound vessels loaded with illegally refined products and destroy them.

Also, some states in the region, like Rivers under the administration of Governor Nyesom Wike, have launched onslaughts against illegal refinery camps. Wike declared the war following the threats to the lives of residents caused by soot emanating from illegal refineries that dotted the landscape.

He personally led some clampdowns on such cooking sites in the creeks and forests of the state, directing all the local government chairmen to identify and destroy all the illegal refinery camps in their domains. Though such bold state-backed operations have helped to deplete the number of such sites, illegal refineries have continued to spring up.

The Group Chief Executive Officer, NNPC Limited, Malam Melee Kyari, admitted the prevalence of infractions on oil assets in the region. He said NNPC had been forced to shut down some pipelines because of illegal connections on them by oil thieves in the Niger Delta. He said in some instances one pipeline had 70 to 80 per cent loss.

Kyari said: “We have a massive scale of infractions on our assets along the Niger Delta region particularly in the last six months. We are convinced that the number of illegal refineries is massive and there are many illegal connections to our pipelines. We have more than 300 connections in one single pipeline. Community engagement is necessary. Whenever we have such infractions we shut down our facilities.

“So, we have lost production. We are now producing about 1.4m barrels while we can do about 2.1m barrels. You can technically say that we lose about 700,000 barrels per day of production. It doesn’t mean 700,000 is stolen. But we have 200000 direct losses per day to thieves. At some points, one pipeline gets up to 70 to 80 per cent loss. So, in such instances, we have no option but to shut down the facilities and, once you do this, we count it as loss because it affects the production we should have taken into the market.”

The Public Relations Officer, Nigeria Security and Civil Defence Corps (NSCDC), Shola Odumosu, admitted that despite the clampdown, illegal refinery operations had continued to boom. He said: “Between January to July, we have apprehended over 426 suspected vandals. Between 2019 till date, we have been able to arrest 884 vandals out of which 821 are undergoing prosecutions. 168 are already convicted. We discovered that there are many illegal refineries everywhere in the creeks. We have destroyed 444 illegal refineries. We have continued to launch attacks. But there is a need for us to also engage the host communities.”

Read Also: Exposed: Inside the perilous world of illegal crude oil refiners (1)

Finding lasting solutions to the menace

Some stakeholders believe that military operations cannot stop the proliferation of illegal refineries in the region. Institutions of government, security agencies, civil society groups and leading voices in the Niger Delta are on the same page that community engagements should be explored as the only strategic tool to end the menace.

Recently, as part of efforts to engage communities in the region, the government awarded a N4billion surveillance contract to a former ‘General Officer Commanding (GOC) of the defunct Movement for Emancipation of the Niger Delta (MEND), High Chief Government Ekpemupolo, popularly called Tompolo.  The contract is currently enmeshed in controversies, with major stakeholders insisting that awarding such contracts cannot provide a permanent solution.

The stakeholders and NNPC seem to be in disagreement on the best approach to ending the economic crisis. Eradiri said the Presidency had agreed to the legalisation of artisanal crude oil refining as the best approach to ending the illegality to save the economy, the environment and the future of the Niger Delta. He said Senator Eta Enang was appointed to chair a technical committee established by the Presidency with a mandate to work out modalities of including artisans in the refining process.

He said: “In the North, illegal miners of gold were organised by the Federal Government into cooperatives and they have been integrated into the mining business through a process controlled by the government. It is the same strategy that the government agreed to adopt in the Niger Delta. I remember that these artisanal refiners had a strategic meeting with representatives of the government and with a slide presentation, they showcased the local technology they invented to refine crude oil.

“They have even gone sophisticated in their refining business. They told the NNPC at that meeting to set up dedicated zones and give them at least 1000 barrels every day to refine; while they (NNPC should) monitor the process. For us, legalising artisanal refining will stop the ongoing hide-and-seek and environmental pollution.”

But Kyari insisted that the NNPC had no plans to legalise the local refineries. He said the company would only support the award of licenses to persons desiring to set up modular refineries.

Eradiri, however, said the NNPC had failed to understand the difference between artisanal refining and licensing modular refineries. “A modular refinery costs about $50million. The local people involved in this operation don’t have much money. With less than N5million, people have already set up their cooking pots. We are saying the same working relationship existing between the government and local gold miners in the North should also exist between artisanal refiners in the Niger Delta and the government,” he said.

The Youths and Environmental Advocacy Centre (YEAC), a non-Governmental Organisation (NGO) propounded the Presidential Artisanal Crude Oil Refining Development Initiative (PACORDI). YEAC Founder and Executive Director, Fyneface Dumnamene Fyneface, believes PACORDI, which is in line with Eradiri’s argument, remains the only permanent solution to illegal refining and bunkering in the region. As gold is found in communities in Kebbi, Kaduna, Zamfara, Niger and Osun states, among others, so is crude oil found in Abia, Akwa-Ibom, Bayelsa, Imo, Ondo, Rivers states, among others. Fyneface noted that artisanal gold and crude oil mining are illegal activities with great consequences on the environment, health and revenue, adding that if steps had been taken to legalise artisanal gold mining, the same should be extended to artisanal refining.

“Recall that a 2020 report titled ‘Dirty Fuel’ by Stakeholder Democracy Network (SDN) found out that petrol produced by artisanal refiners in the Niger Delta is cleaner than those imported into Nigeria. The same way government saw that gold produced by illegal refiners in parts of the North and West could stand the quality standard of the London Bullion Market Association (LBMA). It is also on record that illegal artisanally refined petroleum products and crude alike are exported out of this country and billions of dollars lost to the Nigerian state the same way Federal Government saw that between 2012 and 2018, 97 tonnes of gold valued at over $3billion was illegally smuggled out of Nigeria.

“In the case of crude, oil worth over $100million has been smuggled out of Nigeria over time and there is the need to immediately establish a Presidential Artisanal Crude Oil Refining Development Initiative (PACORDI) as a corresponding initiative for those involved in artisanal crude oil refining in the Niger Delta.”

Fyneface said PACORDI, if considered, would result in the creation of over one million new direct crude oil refining and formalised jobs and over 10 million indirect jobs, leading to poverty alleviation for more than 20 million households. He added: “PACORDI will allow the Nigerian National Petroleum Corporation (NNPC) and other independent marketers to purchase locally produced PMS, DPK and AGO in naira, save and boost the nation’s foreign reserves that was hitherto spent on petroleum products importation.

“The establishment of PACORDI that legalises, formalises and regulates artisanal crude oil refining and bunkering activities would address security challenges. With PACORDI, the government would understand and regulate the flow of resources and be able to track markets for their products and movement of funds across the sector.”

Fyneface said the proposal was receiving serious attention from the Presidency. Senator Enang, in a letter dated April 20, 2022, approved partnering with YEAC to provide a coordinated approach and concerted efforts to ensure the integration of artisanal refinery operations into mainstream refineries. Enang said in the letter: “The partnership is expected to provide the platform for the NGO to harness its mission and vision with the programmes of activities of the office of the SSA for sustainable environmental management and economic self-reliance.”

For now, no practical steps have been taken by the Federal Government to actualise the proposal or turn the tide against illegal crude oil refining business activities that seriously endanger practitioners, the embattled people in the Niger Delta as well as the nation’s economy.

• Concluded